Raffles Medical Q3 profit falls 67.4% post-Covid-19, sending shares down 10.8%
Sign up now: Get ST's newsletters delivered to your inbox
Raffles Medical's revenue for the quarter fell 24.6 per cent to $161.6 million.
PHOTO: ST FILE
Mia Pei
SINGAPORE – Raffles Medical Group posted $12.4 million in profit after tax for the third quarter ended Sept 30, 67.4 per cent lower than the $38 million in the corresponding period a year ago.
The results were dampened by a discontinuation of Covid-19 activities, said the company on Monday.
It added that cost inflation had eroded margins.
“The group’s core operations in Singapore remain strong and profitable,” said Raffles Medical.
It noted that its transitional care facilities at the Expo, which were set up during the pandemic to prevent hospitals from being overwhelmed, have been extended to February 2025.
Revenue for the quarter fell 24.6 per cent to $161.6 million, from $214.2 million the year before.
While patient visits in the group’s China operations increased after the cessation of Covid-19 restrictions earlier in 2023, improving its revenue, its hospitals in Shanghai and Chongqing are still in the developmental phase and incurring gestational costs.
The group also highlighted that it has started restructuring and rationalising its China operations to achieve “better operating efficiencies”.
For the three quarters ended September, its revenue dropped 14.7 per cent to $532.4 million while profit fell 25.6 per cent to $72.8 million.
The group highlighted a strong balance sheet with a net cash position of $239.7 million, which improved from the previous year.
Its cash generated from operations stood at $174.3 million for the nine months ended Sept 30.
“The board remains cautious about the dynamic market development in the geographies in which we operate,” said the group, noting an unfavourable business environment with economic uncertainties, coupled with higher inflation and interest rates.
The board, however, expects the group to remain profitable for the rest of the financial year, barring unforeseen circumstances.
Dr Loo Choon Yong, executive chairman of Raffles Medical, said: “The group plans to grow and expand our patient base by offering integrated healthcare services solutions that are tailored to meet our clients’ needs.”
“We are focused on growing in a value-accretive manner and improving the operational leverage of our existing businesses,” he added.
Shares of Raffles Medical fell sharply after its earnings were released.
They were down 13 cents, or 10.8 per cent, to $1.07 at the close of trading on Monday. THE BUSINESS TIMES
